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Backdoor maneuvering brings Leeds back to Bates
England - 31 July, 2007
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More of the odd backdoor doings swung English Leeds United back to Ken Bates.
After Bates, for the second time, won back the right to re-purchase the club, KPMG took heat for its handling of the administration. Now, it has been revealed the offshore company Astor Investment agreed to waive the GBP 17.6 million debt owed to it by the club if Bates were to retain control.
So, while Bates offered a bid of GBP 1.8 million, that move by Astor was enough in KPMG's view to allow Bates to beat an offer of GBP 3.5 million by the Redbus group.
Astor also has earned earlier notoriety in this case. That was the company that threatened to hold up the sale of the club to anyone but Bates if his initial buyback offer of 1p per GBP owed was not taken by the creditors.
For KPMG, which was appointed administrator by an Astor solicitor, a GBP 12.6 million debt owed by Bates was better than a GBP 30.25 million one owed by Redbus.
"The key factor is the Astor waiver of the debt for one of the bidders, which at the least is unusual," said Dean Dorrell, the chief executive of Redbus to The Guardian newspaper. "Coming across insolvencies as often as we do, it's unusual for an unconnected party to make that offer to a bidder. The whole process was extremely unsatisfactory."
It's just the latest odd move by KPMG, which has been made to look bumbling throughout the ordeal. The administration has cost GBP 885,000 in professional and legal fees, although KPMG refused to disclose how much of this it received.
Redbus believes, though, that despite the waiver offered by Astor, its offer was the best KPMG received for Leeds. In its documents, Redbus claimed KPMG did not account for an additional GBP 8 million that would have been paid by Redbus-Morris in the event of the transfer of the "golden share" from the Football League, which would allow the newly owned Leeds United to kick off the new season.
KPMG countered by saying the "golden share" would have to be paid to creditors anyway, and all offers were even in that respect.
Dorrell took exception, saying there was no rule set down on how to use the "golden share".
After Bates, for the second time, won back the right to re-purchase the club, KPMG took heat for its handling of the administration. Now, it has been revealed the offshore company Astor Investment agreed to waive the GBP 17.6 million debt owed to it by the club if Bates were to retain control.
So, while Bates offered a bid of GBP 1.8 million, that move by Astor was enough in KPMG's view to allow Bates to beat an offer of GBP 3.5 million by the Redbus group.
Astor also has earned earlier notoriety in this case. That was the company that threatened to hold up the sale of the club to anyone but Bates if his initial buyback offer of 1p per GBP owed was not taken by the creditors.
For KPMG, which was appointed administrator by an Astor solicitor, a GBP 12.6 million debt owed by Bates was better than a GBP 30.25 million one owed by Redbus.
"The key factor is the Astor waiver of the debt for one of the bidders, which at the least is unusual," said Dean Dorrell, the chief executive of Redbus to The Guardian newspaper. "Coming across insolvencies as often as we do, it's unusual for an unconnected party to make that offer to a bidder. The whole process was extremely unsatisfactory."
It's just the latest odd move by KPMG, which has been made to look bumbling throughout the ordeal. The administration has cost GBP 885,000 in professional and legal fees, although KPMG refused to disclose how much of this it received.
Redbus believes, though, that despite the waiver offered by Astor, its offer was the best KPMG received for Leeds. In its documents, Redbus claimed KPMG did not account for an additional GBP 8 million that would have been paid by Redbus-Morris in the event of the transfer of the "golden share" from the Football League, which would allow the newly owned Leeds United to kick off the new season.
KPMG countered by saying the "golden share" would have to be paid to creditors anyway, and all offers were even in that respect.
Dorrell took exception, saying there was no rule set down on how to use the "golden share".
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